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Job index reveals employment slowdown

Job index reveals employment slowdown

Although figures from Morgan & Banks' quarterly job index indicate the IT & T industry is characteristically expanding, the latest survey discovered a downturn in the percentage of companies expecting to hire staff.

Well above the all-industry net effect of 24.8 per cent, 49.8 per cent of IT companies are predicting they will hire more staff in the next quarter, a figure down 5.9 per cent on last quarter's index.

According to Ian James, IT director of Morgan & Banks, the phenomenon is simply explained by the fact that hiring intentions have to reach a saturation point. "They can't keep going. What we see instead is changes in certain roles. For instance, 11.3 per cent of staff that firms want to hire in IT will be in sales, a dramatic increase on last quarter's figures. This means that sales people are out there and if they've done the work it will lead to companies wanting to hire more people in the functional area of technology."

Queensland appears to have taken no notice of the fact that these are the worst results Morgan & Banks has posted since May 1997, and is the only state to forecast an increase in the number of staff firms are anticipating they will hire since the last quarter.

According to James, the issue of skill shortages has always been apparent. He suggests that the reductions in hiring intentions in other states are more because of cyclical influences than any specific issue, most obviously Y2K. "Sure organisations are battening down the hatches but companies should be on track for Y2K, which means there are now areas of opportunity for projects to be started or restarted. I don't think the Y2K drop-off effect will be obvious till next year," James said.

Encompassing 3146 employers and 1.9 million employees, the job index stipulates that 60 per cent of job vacancies in the IT industry will be for core computer specialists, which James breaks down to include business positions as well as technical developers.

The survey reveals the net effect of contract and temporary staff in IT is 7.7 per cent, a figure James suspects is slightly down from the last quarter. "The IT industry is skill-based and those skills are expensive," James added. "When an organisation is looking at resourcing a plan it often wouldn't be appropriate to hire permanent staff, especially for a project where there could be a glut of people for part of the phase or the skill is not a core competency of the business."

Despite the declining figures, James is eternally optimistic that the IT industry will remain vibrant and an integral component of businesses across all sectors.

"If the business community in general is doing well, IT will be doing better," he claims, adding that the optimism shown by large and medium-sized businesses is significantly higher than that of all other industries combined, with IT statistics for expected job increases at 43.1 and 58.8 per cent for large and medium businesses respectively, as opposed to the all-industry net effects of 8.5 and 33.6 per cent.


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